We know that, compared to other Western nations, the US has a poor social mobility rate. Why? Where has the American Dream gone?
There are innumerable reasons for the lack of social mobility in the US. Here are a few reasons: 1. Regulatory Inefficiency: What I mean by this is rather than imposing regulations preventing the use of coercion, force, threats, or aggression against new market entrants, many regulations simply take the role of a coercive monopoly. In other words, the government does established businesses dirty work for them. I understand imposing regulations to prevent a negative externality upon society. I also understand imposing regulations to prevent coercive market monopolization. I do not understand, nor do I endorse imposing regulations aimed at preventing the emergence of new markets and new market entrants, a key element in economic mobility, and eventually social mobility. 2. Social Welfare Inefficiency: The US government places a heavy emphasis upon poverty reduction and, in particular, reduction of the symptoms of poverty (food insecurity, affordable housing, etc.), but does not place enough upon the development of human capital. Henceforth, what we see is minuscule reductions in poverty rates since the War on Poverty began, a growing culture of dependency among welfare recipients, and little to no incentives to improve standards of living over the long-run. Rather than simply focus on the immediate needs of the country's poor, the government needs to create a massive vocational, educational, internship, and temporary employment opportunity program. In doing so, it should integrate this program with the income tax system, which is ripe for transformation into a progressive negative income tax system. 3. Civil Society Aid Effectiveness: Just as UNICEF and USAID have difficulties in maximizing their aid effectiveness, so does civil society. The real issue is not only what services is aid allocated to, but the path the aid travels before it is provided to the beneficiary in a good or service. Often there is at least one intermediary between the donor and recipient. This makes for less effective assistance. At the same time, civil society tends to focus on immediate, short-term objectives when it would best serve their missions to take a long-run approach. Let me know if you concur or object to any of my points made above.
I agree with your assessments, but the solutions,while correct, would be politically unpopular. Until the people we send to DC become more interested in helping than maintaining power, little will change.
I concur. As a now practically established resident of DC, I am in the midst of a perpetual game of hardball. Politicians, lobbyists, think-tanks, civil society groups, intergovernmental and supranational organizations, all vying for the maintenance and augmentation of power, are on the field. They have similar standard operating procedures, follow similar rules, and hold similar mindsets. In international relations, we simply call this the realist world order. In the DC world order, I would say this is an apt description, one that is substantiated by the works of Niccolo Machiavelli, Thomas Hobbes, Marcus Tullius Cicero, and Chris Matthews.
No it doesn't. If you compare the US welfare system to other western nations you'll find that the US has one of the least effective systems. See, for example, the work enabled by the Luxembourg Income Study. The US already has significant underemployment (a hidden form of unemployment where human capital is not fully used). Unless you deal with structural problems (e.g. labour market segmentation where labour demand is skewed in favour of low paid labour), human capital investment is likely to just increase underemployment!
We are not discussing the effectiveness of such efforts, merely the amount of public expenditures relative to those of human capital development. The effectiveness of such a system can be addressed through the formation of human capital development programs integrated with a negative income tax system. Perhaps, but these issues are already being addressed. Labor market segmentation should decrease with the passage of the Lilly Ledbetter Fair Pay Act. Furthermore, preferred demand for low-paying jobs requires the development of human capital. It necessitates the development of skills that can propel those who would be low-wage laborers to those of higher paying jobs.
You certainly are as you said "the US government places a heavy emphasis upon poverty reduction". It doesn't. And note that those countries that do are able to generate greater social mobility. This hypothetically could reflect reductions in negative externalities from poverty and also potentially greater entrepreneurial activity (given the effective safety net) Its not that straight forward. Education has to be shifted away from a screening role, towards a human capital role. That simply isn't about investment. It has to be a radical overhauling of the further and higher education sectors
If a government places strong emphasis upon reducing poverty, that does not mean the means in which they reduce poverty are effective. This merely posits that time and money is allocated to this goal. The reason for the failures in US poverty reduction programs, however, is the extensive amount of expenditures directed towards the reduction of the symptoms of poverty rather than the poverty itself. Of course my explanation is simplified. If we were to engage in rigorous economic analysis on the appropriate policies of human capital development, it would require bridging the quantitative-qualitative paradigm along with consulting the disciplines outside the field of political economy. I doubt we have such time to engage in such an endeavor.
There isn't a strong emphasis upon reducing poverty. There is only a strong emphasis on ensuring resources go to those deemed to be deserving poor. There isn't an extensive amount of expenditures directed to reducing poverty, making your initial comment inaccurate. The problem I have is the 'education, education, education' soundbite is the chosen soundbite for most politicians. However, it is meaningless.
Alright, I will make the concession that reduction of poverty symptoms receives more public expenditures relative to actual poverty reduction. Furthermore, I think ignoring the nature in which human capital development investments are used is a problem. It is a problem I have with our international development programs as well. Aid and public expenditures effectiveness is, in comparison to where it could be, abysmal. But once again, for us to make truly beneficial policy prescriptions, it requires extensive quantitative and qualitative economic analysis that borrows from the work of fields outside political economy.
Consider higher education. What happens if you allow growth in the number of students, with the inclusion of subsidies for the poor? The result can actually be negative for social mobility. Whilst we could try and crow about the subsidies, we actually get 'poor quality' rich kids acquiring degrees and replacing 'good quality' poor kids within well-paid employment
Expanding class sizes is certainly a problem, one that, unfortunately, has very few policy prescriptions. Subsidies, or in the broader sense, loans, impose another symptom-based measure that leads to more dependency than social mobility. We see this in the real world with the rise of student unemployment and debt.
Still no solution to the problem! The reference to human capital suggests its a supply-side problem. It isn't that simple, ensuring that the 'education, education, education' politician soundbite is almost always vacuous and a means to avoid the real change required to spur social mobility
Sadly, you are correct. Education alone is not the solution. If we are to address the matter you mention, that being the quality of students relative to their standards of living who are receiving an education, then we must realize that equalizing (leveling) the playing field in terms of wealth is going to be necessary when handling education reform. Improvements in neighborhood development are also imperative.
The right education would fix much of the problem. The problem with the US education system is that it gives short shrift to technology, engineering, science and math (TEMS). Focusing too much on the humanities and social justice. Many kids graduate poorly prepared for immediate employment. With little technical base, they need to learn that before they can begin education suited for employment. The US school system doesn't teach the trades for those not interested in college. 40+ years of bad education resulted in a bad attitude toward school, increasing drop out rates. Is it the parents fault for not "keeping their kids in school", and "working with the school to make it better" (we tried that, the "blob" is too well entrenched), those parents are products of the same system. The social justice education enhances the entitlement mentality, deflecting the blame to "the rich" instead of to the educatin system. The rich remain rich becuase they can afford to go outside the system. The poor remain poor because their parents don't know how to fight the system, and get enough entitlements that they don't fight too hard (after all, a little bit better job, loses them a lot of entitlements). Where is the American Dream? Mostly with immigrantes that come to the US, start their own company, and thrive.
You do see significant mobility generated by immigration. You'd expect that given the diffusion of knowledge such that human capital becomes more compatable with the domestic economy. However, it shold be noted that the second generation again show immobility traits.
